German business morale rises to a record high

German business confidence unexpectedly rose in June to a record high, as strong domestic consumption and robust exports combined to make company executives increasingly upbeat about the growth outlook for Europe’s largest economy.

The Munich-based Ifo economic institute said its business climate index, based on a monthly survey of some 7,000 firms, rose to 115.1 from 114.6 in May.

“Sentiment among German businesses is jubilant,” Ifo chief Clemens Fuest said in a statement.

“Companies were significantly more satisfied with their current business situation this month. They also expect business to improve. Germany’s economy is performing very strongly.”

Ifo economist Klaus Wohlrabe said neither Brexit nor the countdown to federal elections in September had affected business morale, though the election could have an impact in August. Private consumption was a key growth driver and there was still room for expansion in exports, he said.

Growth in the economy, Europe’s largest, accelerated to 0.6%, quarter-on-quarter, in the first three months of 2017. Mr Wohlrabe expected 0.7% in the second quarter.

Andreas Scheuerle, economist at DekaBank, said some German business executives were at risk of getting carried away.

“Even in the first quarter, business sentiment... was much too optimistic compared to actual developments. In the second quarter, this trend was further strengthened. This will correct at some point, but then we should not make the mistake of interpreting this as the way to the next recession.”

Germany’s central bank and leading economic institutes have raised their estimates for German GDP growth for this year and next.

The Bundesbank raised its growth forecasts this month. The government is sticking to its cautious outlook for GDP growth of 1.5% in 2017 and 1.6% in 2018.


Sating the festive appetite is what Christmas is all about, here Joe McNamee takes us through the best culinary delights that are produced right here on our doorstep.Want to give local this Christmas? Joe McNamee rounds up the the country's very best food produce

Architect and artist Harry Wallace tells Eve Kelliher how his style has evolved.How a lifetime as an architect has inspired Cork artist Harry Wallace

Don’t let present stress ruin your run-up to Christmas. Pat Fitzpatrick has done all the hard work with this tongue-in-cheek gift guide for every budget, so you can tick everyone off your list and get down to enjoying yourself for the festive season.Gift stressbuster: We sort out who gets what and why

It’s not what you have that makes you happy, it’s what you do. And what better time to be proactive than during the season of goodwill, says Margaret Jennings.Joy to the world: Strategies to increase your happiness during the season of goodwill

More From The Irish Examiner